CFTC Takes Action Against Crypto Fraud as Regulatory Shift Continues

The US Commodity Futures Trading Commission (CFTC) has issued a consent order against Rashawn Russell, a New York resident, for defrauding investors in a crypto trading scheme. Russell misappropriated around $1.5 million between 2020 and 2022, falsely guaranteeing investors no losses and promising returns of at least 25%. He has pleaded guilty to wire fraud in the US District Court for the Eastern District of New York.

This enforcement action aligns with the CFTC’s recent crackdown on crypto fraud, following Acting Chair Caroline Pham’s announcement on February 4. The agency is restructuring its Division of Enforcement, launching two task forces—one focused on retail fraud and another on complex fraud and market manipulation.

The move follows the CFTC’s aggressive enforcement in 2024 under former Chair Rostin Behnam, which resulted in over $17 billion in monetary relief, largely from its case against FTX. The latest actions suggest a shift in regulatory strategy, moving away from enforcement-driven oversight of crypto firms dealing in digital assets classified as commodities.

Meanwhile, the US Securities and Exchange Commission (SEC) is also ramping up its crypto oversight. In January, the SEC announced plans to establish a dedicated crypto task force to craft a regulatory framework. This development follows Commissioner Mark Uyeda’s appointment as acting chair after Gary Gensler’s departure. The US Senate is now considering former commissioner Paul Atkins for a permanent role.

The increasing scrutiny from both regulators highlights the growing focus on crypto-related fraud and compliance, signaling a tougher stance on digital asset markets.